Quinn contempt case set for March

Contempt of court proceedings by Anglo Irish Bank against bankrupt businessman Seán Quinn, his son Seán Quinn jnr, and his nephew, Peter Darragh Quinn over alleged "asset stripping" have been fixed for hearing at the High Court on March 21st.

Anglo, now Irish Bank Resolution Corporation, has alleged contempt over alleged breaches of an injunction issued last July by Mr Justice Frank Clarke preventing the Quinn side dissipating certain assets.

When the matter came before him today, Mr Justice  Clarke was told that while both sides accepted it had to be adjourned to allow the Quinn side time to prepare their defence, there was a dispute over the length of the adjournment.

Bill Shipsey SC, for the Quinns, said this was not a normal application for contempt as it ranged across matters in several jurisdictions, including Belize, Panama, Ukraine and Russia.

His side would need to make inquiries in those jurisdictions as the bank had raised three specific matters on July 6th 2011, July 20th 2011 and August 30th, 2011. There was also a sworn statement by Richard Woodhouse of IBRC that certain matters could not be reversed, counsel said.

His side would file at least four replying affidavits and wanted four weeks to deliver those after which the bank might wish to reply. The contempt matter would take weeks to hear, not days, he added.

Mr Shipsey said the bank had since September last to get its proofs together and it was not unreasonable to allow his side some time. He would also be very concerned if there were some form of "rolling contempt" where the bank would add more claims of contempt.

Rossa Fanning, also for the Quinns, said the bank was really trying, through the contempt motion, to follow its substantive case over these assets as that substantive case was "on ice" while jurisdictional issues are decided by the European Courts. The court should not allow the bank do this, he said.

Paul Gallagher SC, for IBRC, said this matter was urgent and his side was very concerned, unless it was speedily addressed, the bank's security would be further diminished. The Quinn side were told last September of the bank's concerns about asset stripping from various companies and had said that was done prior to any injunction, he said.

However, Mr Gallagher said, his side had learned after certain documents were discovered that there was an issue about the back-dating of documents so as to support claims assets had not been stripped after the injunction was granted.

The bank had learned a company said to have received an assignment on April 6th, 2011 did not actually exist on that date, counsel said.

The defendants were aware since September of these matters and the suggestion they needed considerable time to prepare for this motion was unjustified. There was concern high-value assets could be sold and the bank would lose out.

This matter was "like a multi-headed hydra", counsel said. "You cut one head off and more appear," he said, adding that the background was "moving all the time".

Mr Justice Clarke said any application alleging contempt was a serious matter which should be dealt with speedily but, precisely because it was serious matter, there had to be a proper opportunity to defend it and the court had to balance those two considerations.

There was a clear dispute whether members of the Quinn family engaged in asset stripping so as to deprive the bank of its security, he said.

If the court was to find contempt, it would wish to deprive the guilty of any benefit of that contempt, he added. It was possible a finding of contempt could have a real effect in other jurisdictions and this placed a real urgency on this matter.

In the circumstances, he would be reluctant to let the matter go beyond this court term and would fix it for hearing on March 21st in the expectation it would run for eight days, the judge said.

In its main proceedings, the bank has alleged the Quinn family was trying to put foreign properties with a value of up to €500 million, on which the bank claims it has legitimate charges, beyond its reach.

The bank has already seized the Quinn Group and the foreign property portfolio is the most valuable remaining asset owned by the family. The properties are owned by way of a web of international holding companies..

The main case, being heard by Mr Justice Clarke, is awaiting a ruling from the European Court of Justice on a matter of jurisdiction but injunction protecting the assets remains in place.

The defendants in the main case are Mr Quinn, his son Seán jnr, and his nephew Peter, as well as his wife, Patricia, daughters Ciara, Colette, Brenda and Aoife, and sons-in-law Stephen Kelly and Niall McPartland. The contempt motion is only against Mr Quinn, his son and his nephew.